Shop of the Future: A Q&A with AASP/NJ President Jerry McNee

by Chasidy Rae Sisk

From electric vehicles (EVs), ADAS and diagnostics to OEM certification, DRPs and consolidation, the future of the collision repair industry is rife with challenges for shops that want to remain competitive amidst these never-ending changes.

Retaining employees has become even more important than attracting clients, but simultaneously, no business can be successful without maintaining a superior level of customer service. So, how can auto body facilities navigate the myriad aspects of the business to become a “shop of the future?”

AASP/NJ President Jerry McNee shares his thoughts on some of the industry’s most pressing topics with New Jersey Automotive readers.

New Jersey Automotive: How big is the EV wave going to be? How much of that wave is already here? Is the industry ready for this in terms of getting proper training from the OEMs, I-CAR, etc.? What are the major training resources now and planned for the future? What new safety concerns do they present to technicians? Will shops need to be specialized/certified to properly handle EVs?

Jerry McNee: Looking at the recent data, Tesla increased sales 41 percent while every other OE has negatively dropped in sales. Then there are new EV companies, like Rivian and Lucid…EVs are here. Is the industry ready for this in terms of getting proper training from the OEMs? No! Unless it’s mandatory, most shops will not follow through, invest or qualify. I-CAR training would be the simplest path for a shop if offered online, but again, if a shop has to travel for hands-on training, it probably will not happen unless it’s mandatory. But this isn’t any different from what is currently taking place now.

Training resources include OEM hands on training, OE certification, I-CAR, and shops can also look to their local equipment vendors because most offer in-person, hands-on training for proper use of the equipment and tools. There are lots of safety concerns for technicians associated with EVs, including death, fire and electrocution. I recently heard of a paintless dent repair (PDR) tech who was electrocuted, and there was another death from an airbag deployment. Our employees’ safety should be our number one concern, and this all comes down to personal responsibility and proper training. Face reality and know your limitations! I 100 percent believe shops will need to be certified to handle EVs. This is no longer a mom-and-pop business. We need to explore capital investments and embrace our responsibilities which includes understanding limitations instead of grabbing everything that comes to our door because we’re afraid to give up a repair. Not everyone can be everything.

NJA: How much of a player will OEM-certified shops be in the future? Are they going to replace DRPs? What do shops most need to do to become certified – and maintain that certification down the road?

JM: My opinion is that OEM certification should be the only way. OEs want properly trained and equipped shops to repair their brands. Without parts restrictions, it will limit shops from making the investment in training or equipment. Whether they are going to replace DRPs is a great question…I would like to think so because it’s necessary to meet the OE standards of repair. Most DRPs are limited because insurance managers are only concerned with reducing the cost of repairs at any cost.

What do shops most need to do to become certified – and maintain that certification down the road? In terms of obtaining and maintaining certification, it depends entirely on the size of the shop or the number of certifications. For starters, it will require a full-time employee to maintain and monitor all requirements, tooling, training, equipment logs, audits, gap reports, etc. This is not a one-and-done activity; it is an ongoing, ever-changing road tied to training paths and recertification and it involves multiple employees. Most importantly, shops need to question if certification is the right fit for their business model.

NJA: Where is the industry headed when it comes to the scan tools needed to perform diagnostics? Are non-OEM-approved tools going to be enough? Where does the insurance industry come into play?

JM: This is a never-ending rabbit hole, and there isn’t one tool that covers them all. Every OEM has a list of required tools and equipment with mandatory tooling updates. Non-OEM-approved tools are absolutely not going to be enough! Nothing will take the place of OE requirements. The insurance industry shouldn’t come into place because it’s the repairer’s responsibility to perform a safe and proper repair. The insurer’s job is merely to indemnify the claim for a safe and proper repair. OE repair procedures can’t be ignored; we can no longer repair vehicles as we have done in the past, and the simplest of tasks can’t be overlooked.

NJA: How prevalent will consolidation be down the road? Are we going to see a bigger wave in your market in the future?

JM: Consolidators and equity investors are on a quest to buy as many shops as possible because they see our industry as recession proof, with a guaranteed book of insurance business. It’s about gross sales; it’s a numbers game. It’s hard to say whether we should anticipate a bigger wave of consolidators coming to New Jersey in the future…Consolidation may not be as big here as in other parts of the country since East Coast shops and properties tend to be on the smaller side, but I do see them growing throughout the state. It’s sad to say, but insurers will bump them to the top of their DRP programs.

NJA: How will consumer marketing need to change in the future? How will our efforts to educate consumers in the future differ from what we’re doing now?

JM: Education is vital. Consumers need to know who they’re hiring, whether that’s their shop or an insurance company. They need to know the OE level of safety in place and the reason behind it. We have no choice but to honor our commitment to our customers, our level of service and certifications by showing that we have their best interest at heart, even behind closed doors. We must repair their vehicle as per manufacturer’s requirements safely and properly. We need to own our market. Take note of how well the insurers market, but can you run your business on false promises? Shops can be successful by honoring our promises.

NJA: What will shops need to do to attract and retain young employees in the future vs. what worked in the past? What role does shop culture play in employee retention?

JM: Looking to the future, especially in terms of attracting and retaining employees, will require shops to focus on a number of things: OEM certifications, culture, family environment, team building, retention, educational growth, mentoring program, a clear career path, 401(k) plan, company match, health insurance, vacation time, PTO, team building events outside the workplace…this a corporate business, and employees need to feel appreciated. Over my career, I have seen many shops just hire a body, but when we do that, there’s nothing to keep them engaged other than a paycheck! We have to lead by example by running a professionally, properly equipped facility with fully engaged employees…a corporate run business with proper leadership.

Want more? Check out the August 2023 issue of New Jersey Automotive!